As tropical storm Isaac makes its way across the Gulf of Mexico, the Bureau of Safety and Environmental Enforcement (BSEE) reports that 58 percent of oil and gas production platforms have been evacuated in the gulf and an estimated 78 percent of daily oil production in the area has been taken offline.
Of the 596 manned platforms in the Gulf, 346 have been evacuated. A further 41 oil rigs — 54 percent of the total 76 rigs operating in the area — have also been evacuated as Isaac moves into the region.
Furthermore, along with 78 percent of daily oil production being shut in, 48 percent of daily natural gas production is being shut in as well.
Production platforms are stationary structures located offshore that produce oil and natural gas, while drilling rigs typically move from location to location.
According to the Houston Chronicle, about 16 percent of the nation’s gasoline refining capacity is also located in the storm’s path, and gas companies like Valero Energy Corporation, Marathon Petroleum Corp. and Phillips 66 have started to shut down more than 1.1 million barrels of refining capacity.
This could very well lead to higher prices at the pump, analysts say. Andrew Lipow, president of Lipow Oil Associates, predicts gas prices could rise between 5 cents and 10 cents per gallon in the coming days and stay high for several weeks, mostly due to the storm.
Oil prices rose again this morning on expectations that crude oil inventories would drop due to Isaac, and price swings are likely to continue as the storm heads toward the coast.
Isaac has forced the governors of Louisiana , Mississippi and Alabama to declare a state of emergency in order to prepare their respective states for the coming storm.
Isaac is projected to hit Louisiana with Category 2 strength. Hurricane Katrina which was a Category 3 when it hit the state.
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